Creativity and/in Entrepreneurship

1. Creativity and/in Entrepreneurship Dr. S. Jeyavelu Nalam Consultants Adjunct Faculty IIM Kozhikode

2. How many of you want to be Entrepreneurs?Why? Nalam Consultants

3. What do you mean by an Entrepreneur? Nalam Consultants

4. What is Creativity? Nalam Consultants

5. What is Creativity? Novel / Unique & Appropriate / Useful Nalam Consultants

6. Exercise 1 Write down as many as possible uncommon uses for the object shown. The person who comes out with the maximum uses will be declared the winner. Nalam Consultants

7. Elaboration Improvement Synthesis Transformation Windows OS Versions; Indica Versions Bajaj 4S to Pulsar New Generation Mobiles-camera, internet, etc Mainframes to IBM PC, Conventional phones to Mobiles Levels of Creativity Nalam Consultants Source: Khandwalla, Lifelong Creativity

8. Types of Creativity • Essence Creativity • ..distilled creativity, the heart made visible.. • ..a fresh idea or concept or definition, a novel view point or interpretation or relationship or hypothesis/generalization, fresh wisdom, • Gandhi’s Non-Violence • Entrepreneurship Example? • Elaborative Creativity • Distinctive elaboration of an idea, view point, principle, law, or issue which is contextually appropriate • Epics, poems • Entrepreneurship Example? Nalam Consultants Source: Khandwalla, Lifelong Creativity

9. Expressive Creativity • Novel & appropriate communication • “Long years ago, India made a tryst with destiny and the hour has come to redeem her pledge. At the stroke of midnight hour, when the world sleeps, India will awake to life and freedom” • Entrepreneurship Example? • Existential Creativity • ..concerns with effectiveness, creativity, self actualization potential of one own self & enhance human and natural worlds • Sadhus, • Entrepreneurship Example? Nalam Consultants Source: Khandwalla, Lifelong Creativity

10. Empowerment Creativity • ..concerned with effectiveness, creativity, self actualization potential of others • Ela Bhatt • Entrepreneurship Example? • Entrepreneurial Creativity • ..generation and implementation of novel, appropriate ideas to establish a new venture • ..novel prods/services, means of producing them, ways of utilization of resources, markets, resources, use of technology, etc • Ambanis, Mittal, • Your Role Model? Nalam Consultants Source: Khandwalla, Lifelong Creativity

11. Exercise 2 Write down as many as possible uncommon uses for the object shown. The person who comes out with the maximum uses will be declared the winner. Nalam Consultants

12. Exercise 3 Write down as many as possible uncommon uses for the object shown. The person who comes out with the maximum uses will be declared the winner. Nalam Consultants

13. Creativity in Entrepreneurship • Inherent Creativity • Systemic Creativity Nalam Consultants

14. Creativity and Entrepreneurship • Creativity in Product / Service • Blackberry, Google, Facebook, • Any Examples you know of? • Creativity in Organizing / Business Model • Naukri, Makemytrip.com, bharatmatrimony.com • Any Examples you know of? • Combined • Apple iPod • Any Examples you know of? Nalam Consultants

15. Blackberry • Catered to increasing demand for a combined service /device for voice and email applications • The first of Smartphones, almost replacing the need for laptops for travelling executives. • Around 8-9 million users Nalam Consultants

16. Naukri.com • Monster.com clone • Leveraged on local understanding • Refined business model based on local conditions • Relationships • Value added services Nalam Consultants

17. Apple iPod • First to grow the mp3 player market • Created a new business model • iTunes – online purchase of a song for 99 cents • Cannot differentiate whether it is a product or a service! Nalam Consultants

18. My Experience with Start Ups Nalam Consultants

19. TN Software Co • Founded in 1990s • ERP solutions for SMEs in logistics/health/hospitality sector • First product based on client request, subsequent sale of the same • Built competency around servicing client requirements, local/contextual knowledge, fast response time and customer satisfaction through service • Now is becoming an all India player, getting into new industry Nalam Consultants

20. Chennai Software Co • Started as fully export oriented unit in a small town • Clients in UK, South Africa, etc • Low end services – html, php, .NET, etc • Built core competencies around customer relationship management, personal touch, etc • Business growing Nalam Consultants

21. Tourism Co • Innovative business model • Won accolades as best business plan / concept • After 2 years • 14 people • Revenues not covering overheads • Founders falling out with interpersonal tussles • Core competencies in totally new segments, built relationships with suppliers, built knowledge base, very good in operations, on the field, etc • Not good in marketing – Pricing, Segmentation, Branding, etc Nalam Consultants

22. Brainstorming • Suspend Judgment • Quantity • Fantasize • Hitchhike Nalam Consultants

23. Secrets for better Brainstorming • Sharpen Focus • Playful Rules • Number Your Ideas • Build & Jump • The Space Remembers • Stretch Your Mental Muscles Nalam Consultants Source: Kelly, The art of Innovation

24. Exercise • Brain Storming • Two Stages • Divergent Thinking or Idea Generation • Convergent Thinking or Implementation Planning Nalam Consultants

25. Brain Storming Stage 1 – Idea Generation • State the problem • Understand the problem by referring to relevant data and using convergent thinking • Restate the problem in the form “How to ___” • Identify most promising statement(s) • Brain storm • Number the ideas • Don’t judge any idea • Focus on getting as many ideas as possible • Fantasize & dream to get wild ideas • Cross fertilize / hitch hike on earlier ideas • Don’t get stuck – Keep jumping • Classify the ideas into Wild (W), High Potential (H), Moderate Potential (M) & Low Potential (L) Nalam Consultants

26. Brain Storming Stage 2 – Implementation Plan • Identify and enumerate criteria for evaluating the solutions • Evaluate High Potential (H) & Wild (W) ideas • Combine, Split, Recombine, Reorganize the ideas to arrive at fewer solutions • Identify – What, Who, When, Where & How for implementing each solution • Arrive at multiple scenarios and an implementation plan Nalam Consultants

27. Attribute Listing • List attributes of the object • Example • Color • Form • Weight • Material • size Nalam Consultants

28. Checklist of Questions A S A R A M O M O A • Add • Subtract • Alter • Rearrange • Adapt • Magnify • Opposite • Minify • Other Uses • Alternative ways? Nalam Consultants

29. Blue Ocean Strategy for Start Ups Nalam Consultants

30. Value Innovation Value innovation is created in the region where a company’s actions favorably affect both its cost structure and its value proposition to buyers. Cost savings are made by eliminating and reducing the factors an industry competes on. Buyer value is lifted by raising and creating elements the industry has never offered. Over time, costs are reduced further as scale economies kick in due to the high sales volumes that superior value generates. Costs ValueInnovation Buyer Value Nalam Consultants

31. Value Innovation Nalam Consultants

32. Red Ocean Versus Blue Ocean Startegy In the red ocean, differentiation costs because firms compete with the same best-practice principle. Here, the strategic choices for firms are to pursue either differentiation or low cost. In the reconstructionist world, however, the strategic aim is to create new best-practice rules by breaking the existing value-cost trade-off and thereby creating blue ocean. Nalam Consultants

33. Red Ocean Versus Blue Ocean Strategy Nalam Consultants

34. The Four Actions Framework • 1. Which of the factors that the industry takes for granted should be eliminated? • 2. Which factors should be reduced well below the industry’s standard? • 3. Which factors should be raised well above the industry’s standard? • 4. Which factors should be createdthat the industry has never offered? Nalam Consultants

35. Four Actions Framework + Eliminate/Reduce/Raise/Create Grid Reduce Four Actions Framework Eliminate Create A New Value Curve Raise The Eliminate-Reduce-Raise-Create Grid Nalam Consultants

36. An Example Nalam Consultants

37. ??? Nalam Consultants

38. Strategy Canvas (Yellow Tail) Nalam Consultants

39. Eliminate Enological Terminology & Distinctions Aging Qualities Above-the-line-marketing Raise Price vs. Budget Wines Retail Store Involvement Reduce Wine Complexity Wine Range Vineyard Prestige Create Easy Drinking Ease of Selection Fun and Adventure ERRC Grid

40. Eliminate Enological Terminology & Distinctions Aging Qualities Above-the-line-marketing Create Easy Drinking Ease of Selection Fun and Adventure Reduce Wine Complexity Wine Range Vineyard Prestige Raise Price vs. Budget Wines Retail Store Involvement ERRC Grid Boundary Definition Outcomes Industry Market

41. Strategy Canvas 4. Create 2. Eliminate 5. Raise 1. Industry assumptions 3. Reduce

42. The Six Principles of Blue Ocean Strategy This figure highlights the six principles driving the successful formulation and execution of blue ocean strategy and the risks that these principles attenuate. Nalam Consultants

43. The Six Principles of Blue Ocean Strategy Nalam Consultants

44. Strategy Canvas The strategy canvas is both a diagnostic and an action framework for building a compelling blue ocean strategy. It captures the current state of play in the known market space. This allows you to understand where the competition is currently investing, the factors the industry currently competes on in products, service, and delivery, and what customers receive from the existing competitive offerings on the market. The horizontal axis captures the range of factors the industry competes on an invests in. The vertical axis captures the offering level that buyers receive across all these key competing factors. The value curve then provides a graphic depiction of a company’s relative performance across its industry’s factors of competition. High Low Wine range Above-the-line marketing Vineyard prestige and legacy Price Use of enological terminology Nalam Consultants Aging quality Wine complexity

45. Strategy Canvas High Low Nalam Consultants

46. Four Actions Framework + Eliminate/Reduce/Raise/Create Grid Reduce The four actions framework offers an technique that breaks the trade-off between differentiation and low cost and to create a new value curve. It answers the four key questions of what industry takes for granted and needs to be eliminated; what factors need to be reduced below industry standards; what factors need to be raised above industry standards; and what should be created that the industry has never offered. Which factors should be reduced well below industry standards? Eliminate A New Value Curve Create Which factors should be created that the industry has never offered? Which of the factors that the industry takes for granted should be eliminated? Raise Which factors should be raised well above the industry’s standard? The eliminate-reduce-raise-create grid pushes companies not only to ask all four questions in the four actions framework but also to act on all four to create a new value curve. By driving companies to fill in the grid with the actions of eliminating, reducing, raising, and creating, the grid provides four immediate benefits: it pushes them to simultaneously pursue differentiation and low costs; identifies companies who are only raising and creating thereby raising costs; makes it easier for managers to understand and comply; and it drives companies to scrutinize every factor the industry competes on. Nalam Consultants

47. Four Steps of Visualizing Strategy The four steps of visualizing strategy builds on the six paths of creating blue oceans and involves a lot of visual stimulation in order to unlock people’s creativity. The four steps include visual awakening, visual exploration, visual strategy fair, and visual communication. Nalam Consultants

48. Four Steps of Visualizing Strategy Nalam Consultants

49. Pioneer, Settler, Migrator Map A corporate management team pursuing profitable growth can plot the company’s current and planned portfolios on a pioneer-migrator-settler (PMS) map. This strategy can help a company determine which businesses experience the highest and lowest growth and cash flow. These are classified accordingly with the highest growth potential being pioneers, then to migrators, then to the lowest rung, settlers. Pioneers Migrators Settlers Nalam Consultants Today Tomorrow

50. Pioneer, Settler, Migrator Map Pioneers Migrators Settlers Nalam Consultants Today Tomorrow